Rogers Communications has agreed terms to acquire 100% of Canadian alternative operator Call-Net, in a move that will speed up its entry into the local voice calls market and bolster its position in a data services segment dominated by incumbent local exchange carriers (ILECs). Under the provisions of the share-swap deal announced yesterday, Call-Net Common and Class B shareholders will receive one Rogers share for each 4.25 of outstanding Call-Net shares, equivalent to USD264 million on a fully diluted basis.
Acquiring Call-Net, one of Canada’s leading alternative operators, will give Rogers Communications a number of benefits. The alternative telco owns a 14,000km fibre-optic network in Canada and the US, and has a presence in 151 ILEC local exchanges covering more than 4.4 million homes, including all major urban centres. In addition, it has xDSL equipment co-located in 50 exchanges, 311,000 residential and SOHO subscribers, and the rights to purchase metropolitan assets from BCE.